Capital expenditure (CAPEX)
Funds used by an entity to acquire, upgrade, or maintain long-term assets.
OpenFinancial Dictionary
Accounting & Finance Terms (English)
Accounting and Finance Terms Explained
Explore accounting, finance, auditing, taxation, and economics terms explained in clear English. Each entry provides a definition, a detailed explanation, practical uses, and examples where available.
Use the search box below to find a term by its name, definition, application, or related financial concept.
Capital expenditure - CAPEX
Capital expenditure (CAPEX) represents funds used to acquire or improve long-term assets that generate future economic benefits.
Opencapital expenditure decision
Capital expenditure (CAPEX) represents funds used to acquire or improve long-term assets that generate future economic benefits.
Opencapital expenditures
Capital expenditure (CAPEX) represents funds used to acquire or improve long-term assets that generate future economic benefits.
OpenCAPITAL FUNDS
is the total of capital debentures, if any, capital stock, if any, surplus, undivided profits, unallocated reserves, guaranty fund, and guaranty fund surplus.
OpenCapital Gain
Capital gains arise from selling non-inventory assets at a price higher than their purchase cost.
OpenCAPITAL IMPROVEMENT
A capital improvement in real estate is any permanent structure or other asset added to the property that adds to its value. In general, any value-added activity or cost to a long-term or permanent as...
OpenCapital Infusion
often refers to the cross-subsidization of divisions within a firm. When one division is not doing well, it might benefit from an infusion of new funds from the more successful divisions. In the conte...
OpenCapital Intensive
Capital intensive is used to describe industries or sectors of the economy that require large investments in capital assets to produce their goods, such as the automobile industry. These companies nee...
OpenCapital Projects Funds
Funds used by a not-for-profit organization to account for all resources used for the development of a land improvement or building addition or renovation.
OpenCarbon Accounting
Carbon accounting measures and reports greenhouse gas emissions to support environmental management and regulatory compliance.
OpenCash Basis
The cash basis is simpler but may not reflect true performance because it ignores receivables, payables, and accrued items.
OpenCash Conversion Cycle
It combines days inventory outstanding, days sales outstanding, and days payable outstanding to assess working capital efficiency.
OpenCash Equivalent
Cash equivalents are short-term, highly liquid investments that can be quickly converted into known amounts of cash.
OpenCash Equivalents
Cash equivalents are short-term, highly liquid investments that can be quickly converted into cash with minimal risk.
OpenCash Flow
Cash flow refers to the movement of money into and out of a business. Positive cash flow indicates the company can meet financial obligations, while negative cash flow suggests liquidity issues. Cash ...
OpenCash Flow
Cash flow reflects liquidity and is often analyzed through operating, investing, and financing activities to assess the ability to meet obligations and fund growth.
OpenCash Ratio
The cash ratio measures a company’s ability to pay short-term liabilities using only cash and near-cash assets.
Opencash receipt
The collection of money in cash or current date checks.
OpenCash Sales
It is sales that are collected in cash or by checks that are currently payable.
OpenCash-generating unit
A cash-generating unit (CGU) is the smallest group of assets that generates largely independent cash inflows, used for impairment testing.
OpenCash-settled share-based payment
A transaction where the entity incurs a liability based on the share price.
OpenCCC
CCC is an acronym for Cash Conversion Cycle
OpenCD
CD commonly stands for Certificate of Deposit, a bank time deposit that pays interest and is repaid at maturity, often with penalties for early withdrawal.
OpenCEO
is an acronym for Chief Executive Officer. The CEO is the principle individual responsible for the activities of a company.
OpenCertificate of Deposit (CD)
is a document written by a bank or other financial institution that is evidence of a deposit, with the issuer’s promise to return the deposit plus earnings at a specified interest rate within a specif...
OpenCertified Financial Statements
Certified Financial Statements are financial statements that undergone a formal audit by certified public accountant
OpenCFO
is an acronym for Chief Financial Officer. The CFO is the officer in a corporation responsible for handling funds, signing checks, the keeping of financial records, and financial planning for the comp...
OpenChart of Accounts
A listing of all accounts used in the general ledger of an organization.
OpenChart of Accounts
A Chart of Accounts is the structured list and coding of all accounts used in the general ledger, grouped by categories (assets, liabilities, equity, income, expenses) to support consistent recording,...
OpenCheque Clearing
A deposited cheque is submitted for processing and may be paid or returned. Submission for clearing is a processing stage and does not necessarily mean that the funds have been finally collected or ma...
OpenCheques Under Collection
This status identifies the stage between submitting a cheque and receiving confirmation of payment or return. A cheque may be under collection whether it was originally post-dated or payable immediate...
OpenChurning
Churning occurs when sales agents urge a client to cash in an existing insurance policy after a short time and replace it with another. It is a lucrative practice because agents earn commission on eac...
OpenCIA
Wait for it is an acronym for the Central Intelligence Agency but in the financial field it is an acronym for Certified Internal Auditor and can also be used as an acronym for Cash In Advance.
OpenCIBT
is an acronym for Cash Income Before Taxes.
OpenCIP
could be Capital Improvement Plan, Capital Improvement Program, Capital Investment Program, or Capital Investment Proposals.
OpenCloud Accounting
Cloud accounting refers to accounting systems hosted on remote servers and accessed via the internet, enabling real-time data access and scalability.
Opencommon costs
Common costs are shared costs that benefit multiple products or departments and cannot be traced directly to one cost object; they are usually allocated using a rational basis for reporting and decisi...
OpenContingent liability
A contingent liability is a possible obligation that depends on uncertain future events, or a present obligation not recognized because outflow is not probable or cannot be measured reliably.
OpenContinuous Accounting
Continuous accounting distributes accounting activities evenly throughout the period instead of concentrating them at period-end.
OpenContra Account
A Contra Account is linked to another account and carries an opposite normal balance to reduce the related account’s net amount (e.g., accumulated depreciation reduces PPE; allowance for doubtful acco...
OpenContra Account
A contra account is an account linked to another account that carries an opposite balance to reduce (net) the related account’s carrying amount. Common examples include Accumulated Depreciation (contr...
OpenContribution margin
Sales minus variable costs.
OpenControl environment
The overall attitude and actions of management regarding internal control.
OpenControl risk
Control risk is the risk that internal controls will fail to prevent or detect material misstatements in financial statements.
OpenConvertible bond
A bond that can be converted into equity.
OpenCorporate Tax
Corporate tax is calculated based on taxable income after allowable adjustments and requires compliance with registration, filing, and payment obligations.
OpenCorporate tax
Corporate tax is a tax imposed on the taxable profits of businesses and other taxable entities under the relevant tax law.
OpenCost allocation
Assigning indirect costs to cost objects.
OpenCost of Goods Sold (COGS)
COGS represents the direct cost of producing or purchasing goods that were sold during the period. It directly affects gross profit and includes materials, direct labor, and inventory adjustments.
Open